Vic: Costello and Macfarlane could be prosecuted, Labor says

AAP General News (Australia)
08-25-2001
Vic: Costello and Macfarlane could be prosecuted, Labor says

MELBOURNE, Aug 25 AAP - Treasurer Peter Costello and Small Business Minister Ian Macfarlane
could be prosecuted over their involvement in an alleged GST rort, Labor's treasury spokesman
Simon Crean said today.

"Clearly, if this scam which we have identified is more widely spread, there are clear
cases for penalties and maybe even prosecutions," Mr Crean said outside his Melbourne
home.

He said Labor had sent all the documents relating to the allegations to the tax office.

"Let's see what the tax office comes back with," Mr Crean said.

Labor has accused Mr Macfarlane of knowing about a GST scam concerning an electorate
fundraiser for his re-election campaign, at which Mr Costello was guest speaker.

The Groom Electorate Council, in southeast Queensland, is accused of claiming GST refunds
to which it was not entitled as it never charged or paid GST.

Labor this week released leaked Liberal Party minutes detailing concerns within Mr
Macfarlane's Groom Federal Electorate Council (FEC) that it may have breached GST laws.

Labor alleged the documents showed that the Queensland Liberal Party contrived a scheme
to enable its FECs - which are not registered to collect GST - to nevertheless receive
refunds of input tax credits on fundraisers.

The documents showed that the Queensland Liberal Party, which is GST registered, would
pay bills over $2,000 on behalf of the FECs and it would later receive the refunded input
tax credits, Labor said.

Mr Crean today said there was evidence that at least three other Queensland Liberal
branches were also using a scheme to claim unjustified input credits on GST that was not
paid.

He said if Mr Costello and Mr Macfarlane were not sacked by Prime Minister John Howard
over the issue or did not resign, Labor would pursue the issue in parliament this week.

"If this is not resolved we will obviously pursue this matter," Mr Crean said.

"I think you should wait and see what we are prepared to do."

Mr Crean said Mr Macfarlane must resign.

In a statement clarifying his role in the GST controversy, Mr Macfarlane last night
admitted he knew about the issue in December last year, saying the treasurer of the Groom
FEC, Margaret Watts, expressed her concern to him.

In parliament on Thursday, Mr Costello denied knowing about the alleged arrangement,
while Mr Macfarlane described the claims as a wild goose chase.

Mr Costello later released a statement, saying his office informed Mr Macfarlane of
the complaints.

"The treasurer was involved in the cover up as well. We now know he knew back in February
about this but did nothing," Mr Crean said.

"We will be pursuing the treasurer as well."

AAP jt/cdh/las/br

KEYWORD: TAX CREAN

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